Oct. 15 (Bloomberg) -- European stocks climbed amid an
increase in mergers-and-acquisition activity and as a U.S.
report showed retail sales rose more than forecast in September.

Orkla ASA jumped 3.4 percent after agreeing to combine
units with Norsk Hydro ASA. Douglas Holding AG jumped 8.1
percent after Advent International Corp. made a 1.5 billion
euros ($1.9 billion) bid for the retailer. Vivendi SA gained 2.8
percent on a report the company is in talks to merge its mobile-phone unit SFR with Numericable.

The Stoxx Europe 600 Index advanced 0.5 percent to 270.8 at
the close in London, after falling 1.7 percent last week. The
benchmark gauge has rallied 16 percent from this year’s low on
June 4 boosted by bond-purchasing programs from the European
Central Bank and the Federal Reserve.

“We have been in a bit of a phase of consolidation; the
question is ‘do you buy into that?’ and I think you do,” Giles
Keating, head of research for private banking and asset
management at Credit Suisse Group AG said on Bloomberg
Television in London. “If we look at the economic data coming
through, it’s on the positive side. I believe we are seeing an
underlying global upswing. It’s slow and grinding, but it’s
happening.”

Stocks fell in Europe last week after the International
Monetary Fund and the World Bank lowered economic-growth
forecasts and companies predicted their earnings will miss
estimates.

In China, data showed inflation in the world’s second-biggest economy was close to the slowest pace in two years last
month, giving the government more room to stimulate the economy
should it deteriorate. Separate figures showed Chinese imports
increased 2.4 percent from a year earlier while exports climbed
9.9 percent.

Orkla gained 3.4 percent to 46.75 kroner after the company
and Norsk Hydro agreed to combine units to provide aluminum
profiles, building systems and tubing in North America and
Europe. The new entity will have sales of 47 billion kroner
($8.2 billion) and some 25,000 employees.

Douglas Takeover

Douglas jumped 8.1 percent to 37.62 euros, the biggest
increase since Jan. 12, after Advent made an offer of 38 euros
per share for the German cosmetics retailer via investment
vehicle Beauty Holding Three AG.

The retailer’s three largest shareholders have a binding
commitment to accept the bid, Advent said.

Vivendi rallied 2.8 percent to 15.73 euros. Europe’s
biggest media and telecommunications company is in talks to
merge SFR with Numericable, Le Journal du Dimanche reported,
citing unidentified people. The merger would bring 1 billion
euros in savings and Vivendi would keep a 49 percent stake in
the new entity, according to the report.

Renault SA climbed 4.3 percent to 35.84 euros as a
spokeswoman for the French carmaker, Raluca Barb, told Bloomberg
News that there were no plans to change its alliance structure
with Nissan. The shares earlier surged as much as 9.8 percent
after Reuters reported the carmakers are reviewing the crossed
shareholdings that underpin their 13-year-old alliance.

Rentokil, Total

Rentokil Initial Plc climbed 2 percent to 86.9 pence after
the Sunday Telegraph reported that the company may sell or close
its City Link parcel-delivery unit. The newspaper cited an
unidentified official close to the company. Rentokil expects to
make the decision by year-end, it said.

Total SA added 1 percent to 38.50 euros after France’s
largest oil company said European refining margin rose to $51
per tonne in the third quarter, a 34 percent jump from the
previous quarter.

Banco Santander SA gained 1.2 percent to 5.81 euros. The
Spanish lender abandoned its 1.7 billion-pound ($2.7 billion)
purchase of 316 Royal Bank of Scotland Group Plc branches after
delays in the completion of the transaction.

RBS Plans

RBS, Britain’s biggest government-owned bank, had been
required to sell the outlets by 2014 to comply with European
Union state-aid rules after receiving the world’s biggest
banking bailout in 2008. RBS slid 1 percent to 268.1 pence.

Richard Branson’s Virgin Money has been in “informal
contact” with RBS in the past few days about restarting talks
to buy the branches, the Financial Times reported, citing
unidentified people familiar with the matter.